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Wednesday, March 8, 2017

Bitcoin Price Rebounds After Dropping By US$90 In Mere Minutes

People who are keeping an eye on the bitcoin price may wonder what is happening right now. With the bitcoin price dropping by quite a margin for no apparent reason, there is a lot of speculation and confusion among cryptocurrency enthusiasts. Rest assured this has nothing do with the impending SEC decision regarding the bitcoin ETF.

With so much speculation floating around on the internet regarding the bitcoin ETF, one would almost forget other things are taking place as well. For example, the PBoC has not given up on their “crackdown” against bitcoin exchanges, In fact, it appears they will create a list of addresses where exchanges can no longer send money to due to anti-money laundering restrictions

Then again, it appears as if the PBoC wants to create a "blacklist" of specific bitcoin addresses. While that sounds scary, it is not a negative development by any means. Users can generate as many bitcoin addresses as they like without repercussions. This renders the whole ordeal a bit moot, although it seems to have spooked quite a few bitcoin holders for some unknown reason. Then again, expert traders had been warning about a potential retrace for some time now.

At the same time, it appears liquidity on various exchanges has facilitated this dump as well. GDAX, Coinbase, and Gemini saw very little volume when the dump occurred, pushing the bitcoin price to around the US$1190 mark. With little volume on the order books, there is no one to catch the proverbial falling knife. Without a buffer to soak these panic sells, the price took a big hit, although it may only be a temporary setback.

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